"PFC has an important role to play in the development of the power sector. Its plans to get into universal and merchant banking as also the insurance sector are particularly promising," P M Sayeed, Power Minister said at PFC vision conclave in Mussoorie on Friday.
PFC, a development finance institution dedicated for the power sector, has been facing increasing competition from commercial banks in lending to power sector projects.
A foray into banking and insurance sectors would enable the corporation to mobilise funds at a cheaper rate.
The corporation plans to enhance its lending to Rs 50,000 crore (Rs 500 billion) by the end of 11th plan in 2011-12 from Rs 9,400 crore (Rs 94 billion) during 2004-05, V K Garg, PFC chairman and managing director said.
The company would also mobilise about Rs 15,000 crore (Rs 150 billion) during the current fiscal to enhance its lending, he said, adding most of it would be from the domestic market.
Internal task forces have already been constituted to envision business opportunities in new areas, Garg said, adding present and former PFC executives would indulge in brainstorming sessions during the vision conclave to identify new opportunities.
The state-run company is also eyeing equity participation in other businesses besides foraying into non-conventional, captive and even nuclear power projects. The company has already started lending to transmission and distribution projects, Garg added.
The corporation also plans to tap the capital market later this year to raise about Rs 1,000 crore (Rs 10 billion), officials said.
Power Secretary R V Shahi said PFC's proposal for an intial public offering was at "an advanced stage." He refused to elaborate.
